LG Display Q1 2026 Earnings Call - OLED Transition Meets Macro Headwinds and Structural Pain

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display2: Good morning and good evening. Thank you all for joining the conference call for the LG Display earnings results. This conference will start with a presentation followed by a Q&A session. If you have a question, please press star and one on your phone during the Q&A. Now we will begin the presentation on LG Display’s first quarter of fiscal year 2026 earnings results. Good afternoon. This is Kim Kyu Dong, Vice President in charge of Finance & Risk Management Division at LG Display. Thank you for joining our first quarter 2026 earnings conference call.

Joining us today are CFO Kim Sung-hyun, Vice President Cho Seung-hyun in charge of business control and management, Vice President Kim Jong-duk in charge of large display planning and management, An Yoo-shin in charge of medium display planning and management, Vice President Baek Seung-yong in charge of small display planning and management, Vice President Son Ki-hwan in charge of auto marketing, and Kim Yoo-kyung, leader of the business intelligence team. Today’s conference call will be conducted in both Korean and English. For detailed performance-related materials, please refer to our disclosure or the investor relations section in the company website. Please refer to the disclaimer before we begin the presentation. Please be informed that the financial figures presented in today’s earnings release are consolidated figures prepared in accordance with International Financial Reporting Standards.

These figures have not yet been audited by an external auditor and are provided for the convenience of our investors. I will now report on the company’s business performance in Q1 2026. Revenue in Q1 was KRW 5.534 trillion, down 9% year-over-year and 23% quarter-over-quarter on the back of stable OLED product shipment and favorable exchange rate, and despite such external factors as the seasonality and the base effect coming from the discontinuation of the LCD TV business in Q1 last year. Operating profit was KRW 146.7 billion, rising YOY, driven by strengthened business structure and sustained OLED performance. Operating profit margin was 3% and EBITDA margin was 21%. Net income recorded a loss of KRW 575.7 billion due to the impact of FX translation loss on foreign currency debt as the high exchange rate persisted. Next is area shipment and ASP trends.

Area shipment in Q1 was 3.2 million sq m, down 21% QoQ. On top of the seasonality, there was continued push by the company to streamline low-margin models, primarily in the mid-size product line. As for ASP per square meter, it fell 4% QoQ due to the seasonal decline in small panel products with relatively high price per square meter. At $1,244, it was up 55% YOY, thanks to the rising share of OLED as a result from the company’s business structure upgrade efforts. Next, I will discuss the revenue breakdown by product category. TV was 16% and IT 37%. Mobile and others segment accounted for 37%, down 3 percentage points QoQ, as the market entered into seasonality. Auto, which is relatively less season sensitive, took up 10%, up 3 percentage points QoQ. The OLED product group accounted for 60% of total revenue, up 5 percentage points YOY.

We believe that through our persistent internal push to enhance our business structure and shift to an OLED-centric company, we have established a structure that can generate meaningful performance despite unfavorable externality. Next is financial position and key metrics. Cash and cash equivalents in Q1 was KRW 1.525 trillion, largely unchanged QoQ. Of the main financial ratios, current ratio was 74%, almost flat QoQ, with debt to equity ratio at 251% and the net debt to equity ratio at 157%. While there have been temporary fluctuations quarter-over-quarter due to adjustment in our borrowing portfolio and the impact of exchange rates, we plan to further strengthen our financial soundness in the long term. Next is guidance for Q2. Total area is expected to grow by low 10% level QoQ, driven by shipment increase, mainly in large size panels.

As for the price per square meter, it is expected to fall by low to mid 10% due to lower shipments resulting from mobile products seasonality, which typically command higher price per square meter. I will now turn the call over to our CFO, Senior Vice President, Sung-hyun Kim. Good morning and afternoon. This is the CFO, Sung-hyun Kim. Thank you for joining us at this conference call. Despite the seasonality in Q1, we were able to remain profitable for three months in a row thanks to our years-long internal efforts, such as initiatives to transition to a business structure based on OLED and high-end strategic customers, as well as the innovation of cost and improvement of operational efficiency. Furthermore, we have significantly enhanced business stability and competitiveness by increasing the share of OLED out of total revenue to 60%, a 5 percentage point increase YOY.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display1: 이렇듯 과거 대비 확실하게 개선된 사업 체질은 회사가 추구하는 지속 가능한 수익 창출 구조의 탄탄한 기반이 되어 지속적으로 사업 성과를 개선해 나갈 수 있는 동력이 될 것으로 기대합니다.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display2: The clearly improved business fundamentals will serve as the solid foothold for a sustainable profit-generating structure that the company aspires for, and will be the driving force behind our continued improvement in business performance.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display1: 당사는 앞으로도 OLED 중심의 안정적 제품 출하와 사업 성과 확대를 계속해 추진해 나가고자 합니다.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display2: We will keep working to ensure stable OLED-centered product shipments and expansion of business performance.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display1: 다만 외부 환경을 살펴보면 현시점에서 대외 불확실성은 이전보다 더욱 높아지고 있습니다. 반도체 가격 상승뿐만 아니라 글로벌 수요 감소, 에너지 단가 상승, 공급망 차질 등 대외 불확실성의 범위와 규모가 연속적으로 증가하고 있으며, 현재 그 영향을 가늠하기 쉽지 않은 상황입니다.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display2: By looking at the external environment, uncertainties today are higher than ever before. The scope and scale of these uncertainties continue to grow, including not only rising semiconductor prices, but also declining global demand, rising energy costs, and supply chain disruptions, making it difficult to estimate their full impact at this point.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display1: 이에 당사는 대외 경제 상황의 변동성과 외부 불확실성에 대한 면밀한 모니터링 및 이에 따른 신속한 대응력 또한 회사가 필수적으로 갖춰야 할 역량이라고 판단하고, 보다 신중한 접근이 필요할 것으로 전망합니다.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display2: Accordingly, we believe that close monitoring of the external volatility and uncertainties, along with the ability to respond swiftly, are essential capabilities that the company must possess, and that the situation requires more cautious approach.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display1: 한편, 대외 환경의 불확실성이 지속되는 가운데에서도 당사가 강점을 지닌 고사양 제품에 대한 경쟁력이 강화되고 기술 장벽도 함께 높아지고 있는 점은 충분히 긍정적이라 할 수 있겠습니다.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display2: Meanwhile, even as external uncertainties persist, it is highly positive that our competitiveness in high spec products, which is our strength, is increasing, and that technological barriers are rising along with it.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display1: 당사는 외부 불확실성에 대한 최적의 대응 방안을 모색하는 한편, 전사적 노력을 통해 기술 차별화를 강화하여 재무 건전성을 확보하고, 시장과 고객의 기대에 부합하는 지속 가능한 성과를 거둘 수 있도록 노력하겠습니다.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display2: Even as we seek optimal response to external uncertainties, we will strive to secure financial soundness and achieve sustainable results that meet the expectations of the market and our customers based on a company-wide effort to strengthen our technological differentiation.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display1: 다음으로 사업 영역별 계획과 전략에 대해서 간단히 말씀드리겠습니다.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display2: Next, allow me to briefly outline our plans and strategies by business segment.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display1: 소형 모바일 사업의 경우, 기술 리더십과 안정적인 공급 역량을 기반으로 고객사의 다양한 기술적 수요에 유연하게 대응하는 한편, 현재 보유한 생산 인프라를 효율적으로 활용하여 미래 준비도 차질 없이 진행하고자 합니다.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display2: In the small-sized mobile business, we will flexibly respond to our customers’ diverse technical needs based on our technological leadership and reliable supply capabilities. We will also efficiently utilize our existing production infrastructure to ensure seamless preparation for the future.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display1: 중형 사업은 차별적 경쟁력을 확보하고 있는 Tandem OLED와 high-end LCD 기술을 기반으로 고객 수요에 적극 대응하여 고부가가치 제품 중심의 수익성 개선을 이어나갈 계획입니다. 또한 수익성 중심의 제품 포트폴리오 개선을 지속적으로 추진하여 생산 효율성을 계속해서 높여나갈 계획입니다.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display2: In the mid-size business, we plan to continue improving profitability by focusing on high value-added products, actively responding to customer demand with our differentiated competitiveness in Tandem OLED and high-end LCD technology. We also intend to keep improving our product portfolio with a focus on profitability to further enhance production efficiency.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display1: 대형 사업은 당사의 White OLED 기술력을 기반으로 프리미엄 제품군을 강화하는 동시에 가격 경쟁력을 높인 제품 또한 확대해 나갈 계획입니다. 또한 최근 OLED로의 전환이 빠르게 일어나고 있는 모니터 사업에서는 당사만의 독자적인 기술을 적용한 게이밍 제품 라인업을 확대하여 OLED 사업을 확장하고 고객 확보에 주력해 나가고자 합니다.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display2: In large panel business, we plan to strengthen our premium product lineup based on our White OLED technology, while also expanding our range of price competitive products. In monitor business, where the shift to OLED is accelerating rapidly, we intend to grow our OLED business and focus on acquiring customers by expanding our gaming product lineup, which incorporates our proprietary technology.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display1: 모터 사업에서는 경쟁이 점차 치열해지고 있지만, 당사의 차별화된 제품과 기술 포트폴리오를 기반으로 시장 내 입지를 강화하는 노력을 지속하겠습니다.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display2: In auto, where competition is increasingly fierce, we will keep solidifying our market position based on our differentiated product and technology portfolio.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display1: 마지막으로 투자 활동과 관련하여 말씀드리겠습니다.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display2: Finally, a few words on our investment.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display1: 당사는 필수적인 경상 투자, 그리고 미래 준비를 위한 기술 투자 중심으로 Capex를 집행한다는 기조를 유지하고 있습니다.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display2: We maintain the principle of allocating CapEx primarily toward essential current investment and future-proof technology investment.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display1: 전일 오후에 공시된 OLED 기술 신기술 인프라 투자 역시 이와 같은 맥락에서 결정한 것으로, 당사는 OLED 기술 고도화를 통해 기술 경쟁력 및 성장 기반을 강화하여 미래 시장과 고객 수요에 대응해 나갈 계획입니다.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display2: The investment disclosed last afternoon in new OLED technology infrastructure was also decided in this context. We plan to strengthen our technological competitiveness and growth foundation by continuing to upgrade our OLED technology as a way to respond to future market trends and customers’ demand.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display1: 동시에 투자 효율화 활동은 변함없이 지속할 예정입니다. 2026년 Capex는 약 2조 원대로 예상되며, 당사는 앞으로도 미래 성장 준비와 재무 건전성 확보 사이에 적절한 균형점을 찾아 신중하면서도 유연하게 대응할 수 있는 의사 결정 체계를 확보해 나가겠습니다.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display2: At the same time, our work to optimize investment efficiency will continue unchanged. CapEx in 2026 is expected at around KRW 2 trillion. We will continue to build up a decision making framework that enables a prudent, yet flexible response by finding the right balance between preparing for future growth and ensuring financial soundness. Thank you.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display1: 이상으로 2026년 1분기 주요 실적 내용 발표를 마치겠습니다. 다음은 질의응답 시간을 갖도록 하겠습니다. 오퍼레이터께서는 질의응답 안내를 부탁드립니다.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display2: This concludes our presentation of business highlights for Q1 2026. We will now take your questions. Operator, please commence the Q&A session.

Operator: 지금부터 질의응답을 시작하겠습니다. 질문을 하실 분은 전화기 버튼의 별표와 1번을 누르시기 바랍니다. 질문을 취소하시려면 별표와 2번을 누르시면 됩니다. 원활한 회의 진행을 위하여 질문은 한 분당 두 가지 이내로 부탁드립니다.

Operator: Now Q&A session will begin. Please press star one, that is star and one, if you have any questions. Questions will be taken according to the order you have pressed the number star one. For cancellation, please press star two, that is star and two on your phone. In order to allow as many Q&A chances as possible within the restricted time, we would appreciate only two questions per each participant.

Operator: 처음으로 질문해 주실 분은 대신증권의 박강호 님입니다.

Operator: The first question will be provided by Park Kang-ho from Daishin Securities. Please go ahead with your question.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display0: 네, 안녕하세요. 대신증권의 박강호입니다. 질문 기회 주셔서 감사드립니다. 저는 어제 투자 공시한 거에 대해서 질문드리겠습니다. 전일 1.1조원 정도의 OLED 투자 공시를 하셨는데요. 관련 내용을 좀 구체적으로 설명해 주시면 감사하겠습니다. 최근 언론 내용 등을 본다면 북미 스마트폰 업체 향으로 국내 경쟁사가 폴더블 제품을 독점적으로 공급한다는 내용이 많이 언급이 되고 있습니다. 저희가 어제 공시한 투자 계획이 이에 대응한 새로운 내용인지, 아니면 또 새로운 form factor 향의 투자인지 많이 궁금합니다. 만약 그렇다면 이 폴더블 스마트폰과 관련된 저희 LG Display의 사업 전략과 향후 시장 진입 계획이 어떠한지 궁금합니다. 관련된 내용으로 코멘트 좀 부탁드리겠습니다. 감사합니다.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display2: Thank you for taking my question, which is on the disclosure of new investment that was made yesterday. The disclosure was for about KRW 1.1 trillion in OLED. My question is, can the company provide more details about this disclosure? Recent media reports have mentioned that another company is exclusively supplying into foldable products. Is the disclosed investment for new form factors to counter this? If that is the case, then what is LGD’s business strategy regarding foldable smartphones and its market entry?

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display1: 네, CFO입니다. 먼저 첫 번째 질문에 대해서 좀 답을 드리도록 하겠습니다.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display2: This is the CFO. Allow me to respond to your first question.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display1: 여러분들 다 잘 아시겠지만 현재 업계에서 굉장히 기술 발전 속도가 놀랍게 빨라지고 있습니다. 그리고 그런 기술의

중요성이 결국은 회사의 경쟁력으로 전이되고 있고, 모든 업체들이 그 경쟁력을 확보하기 위해서 노력을 하고 있는 상황입니다.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display2: Now, as everyone would know, in the industry, we see that the technological development is really accelerating at a remarkable pace. The importance of technology is also translating into the competitiveness of companies. All the companies are now struggling and really competing against each other to secure the competitiveness.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display1: 이미 말씀드린 바와 같이 당사는 OLED 사업에 계속 집중을 하겠다고 말씀을 드렸고요. 이에 따라서 당사가 적기에 OLED 신기술을 준비를 하고 기술 경쟁력에서 많은 강점을 지니게 되는 경우에 사업 기회를 더 많이 확보하고 산업 내 경쟁력을 유지할 수 있다고 판단합니다.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display2: Now, as has been reiterated several times, the company is focused on the OLED business. Accordingly, the more ready we are with new OLED technologies and the more technologically competitive we are, then there will be more business opportunities coming our way, and we will be able to maintain our competitiveness across the industry.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display: 그래서 저희가 신규 시설 투자 계획을 결정하였고, 그것도 공지를 드렸고요. 어떤 내용인지 구체적으로 말씀을 드리고 싶지만, 당사의 신기술 적용이 결국은 고객사의 신기술 적용과 바로 연결이 되는 상황이기 때문에 저희가 더 이상의 내용은 말씀드릴 수 없는 점을 양해 부탁드리겠습니다.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display2: Yes, the company has made disclosure about new facility investment within this context. As for the specifics, I would love to share more of them, but then, given the fact that our new technology directly translates into new technologies for our customers, please understand that I am not in the position to discuss them further.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display: 소형 계획 관리 담당 백승용입니다. Foldable 관련해서는 제가 말씀드리겠습니다.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display2: This is Baek Seung-Yong, in charge of small display planning and management, and allow me to respond to the question about the foldables.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display: Foldable에 대한 당사의 입장과 시각은 기존과 큰 변화가 없습니다. Foldable 제품이 새로운 form factor를 통해 소비자에게 차별화된 가치를 제공하고, 새로운 시장 동력으로서의 시장 기대치가 높아져 있는 점은 알고 있습니다. 다만 당사는 시장 규모, 성장 속도, 그다음에 기회 요인 등에 대한 가시성이 확보되기 전까지 기존 제품의 생산과 판매를 극대화하여 성과를 확대하는 전략을 운영할 계획입니다.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display2: Our position and perspective on foldable devices remain unchanged. Foldables offer consumers differentiated values through a new form factor, and there are growing market expectations that they will be the new growth driver. Until we gain visibility into market size, pace of growth, and our own opportunities, our strategy will be to grow performance by maximizing production and sales of existing products.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display: 스마트폰 영역에서 새로운 기회 요인이 포착된다면 차별화 제품의 수용성, 그다음에 시장 성장 속도를 면밀히 검토한 후 공급 체계를 준비하고, 중형 Foldable 제품의 양산 경험을 바탕으로 스마트폰에서 새로운 사업 기회를 확대해 나가고자 합니다.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display2: If clear opportunities are identified in the smartphone sector, we will prepare a supply system after carefully reviewing such factors as market acceptance of differentiated products and growth rate. We will then try to build on our mass production experience in mid-size foldable devices to expand new business opportunities in the smartphone sector.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display: 다음 질문 받겠습니다.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display2: We will take the next question.

Operator: 다음으로 질문해 주실 분은 UBS증권의 Jimmy Yoon 님입니다.

Operator: The following question will be presented by Jimmy Yoon from UBS Securities. Please go ahead with your question.

Jimmy Yoon, Analyst, UBS Securities: 네, 안녕하세요. 질문 기회 주셔서 감사합니다. 저는 패널 사업 전반에 대한 질문을 한 가지 드리겠습니다. 메모리 반도체 공급 부족에 따른 원가 상승에 더해 최근에는 중동 사태로 인한 유가 급등으로 시장 내 불확실성이 지금 확대되고 있는 상황입니다. 이로 인해 지금 생산 차질과 수요 변동에 대한 가능성, 그리고 원가 상승으로 인한 고객사들의 판가 압박 우려도 지금 커질 것으로 예상되고 있는데, 이와 관련해서 보시는 수요 영향이랑 대응 방안에 대해서 좀 더 구체적으로 공유주시면 감사하겠습니다.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display2: My question is regarding the overall panel business. Today, we see that the memory shortage is driving up memory prices, and oil price is also surging following the Middle East conflict. Such mounting uncertainties may trigger more concerns regarding potential production disruptions in the tech value chain, shifts in demand, rising costs, and price pressure from customers. What is the expected impact on demand, and what will be the company’s response?

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display: 네, 경영관리담당 조승현입니다. 질문 주신 바와 같이 메모리나 반도체 공급 부족 이슈에 이어서

Cho Seung-hyun, Vice President, in charge of Business Control and Management, LG Display: 말씀 주신 지정학적 이슈 등 산업 전반적으로 불확실성이 상당히 확대되고 커지는 상황은 너무나도 잘 아실 것 같습니다. 다만 상반기, 하반기로 나눠서 상반기를 먼저 보면, 상반기에는 메모리나 반도체 공급 부족 우려로 인해서 고객들의 pull-in 수요가 일부 발생하고 있는 상황입니다. 그리고 예정돼 있는 대형 스포츠 이벤트 효과도 분명히 일부 있을 것으로 판단하고 있습니다. 하반기는 부품 가격 인상과 세트 가격의 변화, 그리고 중동 사태에 따른 매크로 불확실성 등 여러 가지를 고려할 때, 시장 변화에 대해 보다 신중하게 접근해야 할 것으로 판단하고 있습니다.

This is Cho Sunghyun, in charge of business control and management. Now, it is true that the market today is facing growing uncertainties stemming from the memory shortage and the impact of the geopolitical conflict. I believe that we have to look at the first half and the second half of the year separately. Now, in the first half, we are seeing some pull-in demand due to concerns over memory supply. With the scheduled major sporting events coming around, there is expected to be some positive impact. Now, going into the second half of the year, considering factors such as component price hikes, set price changes, and macro uncertainties coming from the Middle Eastern situation, we will have to be more cautious in our approach to market changes.

시장 전반적으로는 대외 불확실성이 확대되고 있습니다만, 업체별로나 고객과 제품 구조에 따라서 그 영향이 조금씩 다르게 나타나고 있는 상황이고, 반도체 가격 상승에 따라서 이런 영향들은 오히려 중저가 제품군에서 더 크게 나타나고 있는 상황입니다. 상대적으로 SCM 경쟁력을 갖춘 글로벌 고객들이 받는 영향은 상당히 제한적일 것으로 판단되고, 오히려 이런 시장 상황을 기회로 삼을 수도 있을 것 같습니다.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display2: While external uncertainties are increasing across the market, the impact varies slightly by company depending on their customer and product structure. The impact of rising chip prices is more pronounced in the mid to low-end product segments, meaning that the impact on global customers with relatively strong SCM competitiveness is likely to be quite limited. It might even be an opportunity for them.

Cho Seung-hyun, Vice President, in charge of Business Control and Management, LG Display: 자사는 변동성 확대 가능성을 고려해서 수요 변화와 부품 수급 동향을 면밀히 모니터링해 나가는 동시에, 글로벌 고객 포트폴리오 및 그동안 지속해 온 또는 자사가 강점이 있는 하이엔드 제품 라인업 기반으로 고객과 적극적으로 협력하고, 원가 혁신에 보다 집중해서 어려운 시장 상황을 잘 극복해 나갈 수 있도록 하겠습니다.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display2: Against the risk of growing volatility, we will closely monitor changes in demand and trends in component supply and demand. We will collaborate with customers and focus more on cost innovation, drawing from our global customer portfolio and established high-end product lineup, and successfully navigate these challenging market conditions.

Cho Seung-hyun, Vice President, in charge of Business Control and Management, LG Display: 다음 질문 받겠습니다.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display2: We will take the next question.

Operator: 다음으로 질문해 주실 분은 삼성증권의 장정훈 님입니다.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display2: The following question will be presented by Jeong Hoon Jang from Samsung Securities. Please go ahead with your question.

Jeong Hoon Jang, Analyst, Samsung Securities: 네, 안녕하세요. 삼성증권 장정훈입니다. 질문 기회 감사드리고요. 저도 비슷한 맥락에서 질문을 드리겠습니다. 최근 미국, 이란 전쟁으로 인해서 전체적인 부품 가격 상승이 눈에 띄고 있다 보니 CFO께서 모두에서 말씀 주신 것과 같이 사업 불확실성도 높아진 부분들인데, 이 부분에서 특히 앞에서는 종성님 말씀해 주셨는데, 대형 패널 부분에서 저희가 지금 준비하고 대응하려고 하는 운영 전략 또는 향후에 성장성에 대한 전략을 어떻게 갖고 계신지 한번 업데이트 주시면 도움이 많이 될 것 같습니다. 감사합니다.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display2: My question is similar with some of the previous questions. Now, there has been some uncertainties in the business, as the CFO has mentioned, with the pronounced effect of the U.S. and Iran conflict, especially on the rise on the commodity prices. So far there was some discussion about the mid-size and small-size businesses, but then for the large panel business as well, then what will be the company’s operational strategy as well as the growth strategy for the future? If you could provide us with an update, much helpful. Thank you.

Kim Jong-duk, Vice President, in charge of Large Display Planning and Management, LG Display: 대형기획관리 담당 김종덕입니다. 대형 사업의 경우, 올해는 원자재하고 반도체 중심의 부품 가격 상승과 같은 업황 불안정 속에서 OLED TV의 경우에는 글로벌 선도 업체하고 하이엔드 브랜드 라인업을 지속적으로 강화하고 있는 상황입니다. 거기에 중저가 OLED TV 라인업도 확대해 가면서 안정적인 수익 구조를 확보하여 내실화를 다져갈 예정입니다.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display2: This is Kim Jong-duk, in charge of Large Display planning and management. For our large panel business, amid industry volatility this year, such as rising prices of commodities as well as the components like semiconductors. We plan to establish a stable revenue structure and strengthen our fundamentals by enhancing our high-end OLED TV lineup with leading global set makers, and also by expanding our mid to low-end OLED TV lineup. For the OLED monitor segment, the high-end gaming monitor market is very rapidly shifting from LCD to OLED. The share out of our total shipment is likely to grow very significantly from low teens% last year to around 20% this year. Our product and customer strategy will be about maximizing our business performance and opportunities through an optimized production share between TVs and monitors, and to keep solidifying our market leadership. Thank you.

We’ll take the next question.

Operator: The following question will be presented by Won-Suk Chung from iM Securities. Please go ahead with your question.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display2: Now, I also have two brief questions. Now, we have been discussing uncertainties a number of times so far. Now, yes, as the uncertainties continue, I believe that perhaps cutting losses from the IT business has made a significant contribution to the company improving profitability YOY and also for the year. As the uncertainties continue, then when does the company believe that you will be able to turn around to profitability? Also, looking at the OLED new investment disclosure yesterday, it seems as if the company is also increasing OLED investment into new technologies. Now, given the fact that the other companies are also looking into the investment for the 8th gen IT OLED and so forth. What is the company’s plan for investment down the road? This is An Yushin, in charge of Medium Display Planning and Management.

Now, the ongoing uncertainties in the external environment, including the U.S.-Iran conflict, makes it difficult to expect a recovery in the IT sector this year. To prepare for increased demand volatility in the second half due to rising commodity prices and prices of some components like semiconductors, we are securing supply flexibility and closely monitoring the situation. Although sales and shipment volumes decreased YOY in the first quarter, profitability improved, thanks to internal initiatives like strengthening our product mix. For the year, we will focus on high-end differentiated products based on long-established customer trust, technological competency, and responsiveness, and further upgrade our high-end focused customer structure and maximize opportunities with a select and focus approach tailored to customer demand, which will keep up our trend of improving profitability.

An Yoo-shin, Vice President, in charge of Medium Display Planning and Management, LG Display: IT 제품은 고객도 다양하고 제품 스펙도 다변화되어 있기 때문에 팹을 운영할 수 있는 수요 확보가 중요하다고 생각합니다. 소비자 니즈를 충족시키기 위해서는 기술력 및 가격 경쟁력 등 여러 가지 요소를 고려해야 할 것으로 생각하고 있습니다.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display2: Regarding IT OLED, as the transition from LCD to OLED accelerates, starting with tablets and extending to monitors, we are aware of the growing interest in the market as well. IT products have a diverse customer base and product specifications, and having sufficient demand to keep the fab running is crucial. To do that, we need to meet consumer needs for technological capabilities and price competitiveness as well.

An Yoo-shin, Vice President, in charge of Medium Display Planning and Management, LG Display: 대외 환경의 불확실성과 이에 따른 수요 변동성이 높아져 있는 상황이 장기간으로 이어지고 있기 때문에, 전방 OLED 제품 수요의 가시성이 보다 명확해지는 시점까지는 신중하게 접근하고자 합니다. 투자 의사 결정에 필요한 수요의 가시성이 확보되기 전까지는 현재 보유한 인프라를 최대한 효율적으로 활용해 나갈 예정이며, 미래 시장 준비를 위해 다양한 방법을 검토 중에 있습니다. 시장이 본격적으로 개화된 시점에 맞춰 늦지 않게 대응할 수 있도록 준비할 예정입니다.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display2: As the period of uncertainty and high volatility in demand continues, we intend to proceed cautiously until there is clearer demand visibility for OLED in the downstream. Until we have enough visibility to make investment decisions, we plan to utilize our existing infrastructure as efficiently as possible. We are actively exploring various strategies to prepare for future opportunities, and we will be ready to respond in a timely manner when the market begins to fully take off.

Kim Sung-hyun, CFO, Senior Vice President, LG Display: 마지막으로 한 분의 질문을 더 받고 마치도록 하겠습니다.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display2: We will take one last question.

Operator: 마지막으로 질문해 주실 분은 신한투자증권의 박현우 님입니다.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display2: The last question will be presented by Hyunwoo Park from Shinhan Investment & Securities. Please go ahead with your question.

Park Hyun-woo, Analyst, Shinhan Investment & Securities: 네, 안녕하세요. 신한투자증권 박현우입니다. 질문 기회 주셔서 감사합니다. 저희 지난해 이어서 금년에도 희망퇴직 신청을 받는다고 하셨는데, 이번 구조조정 규모는 어느 정도로 예상하고 계시며, 어느 시점에 반영 예정이신지 궁금하고요. 그리고 하나 더, 앞으로도 이러한 형태의 인력 구조조정이나 일회성 비용이 지속적으로 발생할 가능성이 있는지 궁금합니다. 네, 이상입니다.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display2: The company is reportedly implementing voluntary retirement this year again, following last year. What is the expected scale of this adjustment, and when will this be reflected? Will there be more of this type of workforce adjustment and one-time cost in the future?

Kim Sung-hyun, CFO, Senior Vice President, LG Display: 네, 언론에서 난 바와 같이 올해도 인력 구조조정을 실시하게 되었습니다. 우리 회사가 OLED 중심의 회사로 변화를 시도하고 있고, 그에 따라서 사업 구조조정도 하고 제품 포트폴리오도 구조화하고, 또 원가 혁신, 비용 개선을 계속 추진해 왔었습니다.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display2: Yes. As have been reported in the media, there is going to be another round of workforce adjustment this year, and this is part of the company’s effort and transition to an OLED-centric company. Along with this, we have been upgrading our business structure and improving our product portfolio and strengthening our cost structure and also undertaking cost innovation.

Kim Sung-hyun, CFO, Senior Vice President, LG Display: 주주 여러분들께서도 되게 반복되는 이런 상황 때문에 많이 피로를 느끼시고, 그 상황에 대해서 잘 인식을 하고 있습니다. 단기적으로는 회사도 비용이 들어가는 부분이고, 신중한 결정과 접근이 필요한 내용인데요. 경쟁력 확보를 통해서 회사의 영속성을 높이기 위해서는 반드시 필요한 과정이라고 저희는 판단을 하고 장기적 관점에서 결정을 내렸습니다.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display2: Now, we are aware of the sense of fatigue that the shareholders might be feeling as the similar event continues to repeat itself. For the short term, yes, this will be something that will incur cost to the company. This is the kind of decision that requires very cautious approach as well. We also see this as a necessary process for the company to remain sustainable. We have made this decision from a long-term perspective.

An Yoo-shin, Vice President, in charge of Medium Display Planning and Management, LG Display: 내부적인 상황이기 때문에 상세 조건을 현재 말씀드릴 수 있는 상황은 아닌 것 같고요. 일부는 언론을 통해서 제법 상세한 내용이 나가기도 했습니다만, 현재 아직 프로그램이 종결이 되지 않은 상황이기 때문에 전체적인 비용의 규모나 이번에

Kim Sung-hyun, CFO, Senior Vice President, LG Display: 대상이 되는 구성원의 수는 아직까지는 밝혀드릴 수 있는 상황이 아닙니다.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display2: As this is an internal company process, the specific terms cannot be disclosed for which I ask for understanding. There have been some fairly detailed reporting by the media as well. The program is still ongoing. It’s not been concluded yet. As for the specific overall cost or the scale, it is too early to tell.

Kim Sung-hyun, CFO, Senior Vice President, LG Display: 지금까지 반복적으로 희망퇴직이 실시가 되었던 것도 회사로서는 되게 바람직한 상황이 아니고, 그리고 이왕 벌어져야 될 일이라면 최대한 단기간 내에 끝나는 것이 우리 조직 구성원들도 많이 안정성을 회복할 것으로 예상되기 때문에 예전보다 강화된 패키지를 제시를 했습니다. 그 이유는 추가적으로 앞으로 더 이상 희망퇴직을 실시하지 않으려는 계획이 있기 때문입니다.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display2: Now, yes, it is true that having the repeated implementation of the voluntary retirement, by no means is desirable for the company either. If it does have to happen, then it better happen within a short period of time so that the sense of stability will be restored among our members. That is why we are offering a much-strengthened package this time around, and this is part of the company’s plan to make sure that this does not have to happen again in the near future.

Kim Sung-hyun, CFO, Senior Vice President, LG Display: 사실 2분기가 고질적으로 우리 회사한테는 항상 영업실적이 좋지 않은 그런 분기였습니다.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display2: Now, the second quarter for the company historically has been a period of poor financial performance.

Kim Sung-hyun, CFO, Senior Vice President, LG Display: 그간의 구조조정과 사업 구조조정 그리고 원가 절감 혁신 활동을 통해서 이번 2분기는 사실 회사가 흑자를 계획하고 있었고, 그 기조에 맞는 운영을 한 달이나마 계속했었고, 현재 2분기까지 흑자를 기록할 걸로 사실은 예상을 하고 있었습니다. 그럼에도 불구하고 회사가 장기적 관점에서 더 좋은 회사가 되고, 더 영속성 있는 회사가 되기 위해서 내린 결정이다 보니까 여러분들께서도 긍정적인 시선으로 현재 벌어지고 있는 상황을 봐주셨으면 좋겠습니다.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display2: Now, of course, we had undertaken some business restructuring, business realignment, and also cost innovation efforts. As a result of these series of efforts, we were planning and expecting profitability in the second quarter of this year. That is how the business was managed as well for at least one month. We were expecting to see profits in the second quarter. Despite that, of course, we continue to try to become a better company, a more sustainable company for the longer term. On that note, I would also like to ask for a more positive view from the shareholders and investors as well.

Kim Sung-hyun, CFO, Senior Vice President, LG Display: 이상으로 LG디스플레이 2026년 1분기 실적 설명회를 마치도록 하겠습니다. 참석해 주신 분들께 감사드리며, 추가 질문이 있으신 분들은 IR팀으로 연락 주시기 바랍니다. 대단히 감사합니다.

Baek Seung-yong, Vice President, in charge of Small Display Planning and Management, LG Display2: This concludes LG Display’s Q1 2026 earnings conference call. We thank everyone for joining us today. Should you have any additional questions, please contact the IR team. Thank you very much.